The article Better tools, the analysis needed to make smart healthcare capital investment decisions, report says by Jeff Lagasse expounds the need for the healthcare industry to have intelligent analytical measures that mitigate financial risks of capital investment. According to Lagasse (2016), healthcare facilities lack critical risk analysis techniques that predict the sector‘s long-term investment returns, resulting in poor patient outcomes, disgruntled hospital personnel, and low business productivity. The author argues that today’s investors in healthcare through methods, such as social financing, may lose their capital because of poor discipline in invested healthcare entities, lack of public reporting of achieved targets, and absence of overall accountability from hospital managers.
Further, Lagasse (2016) highlights the challenges of investing in government-run healthcare facilities to improve quality patient outcomes. For instance, the author notes that most state and federal owned healthcare entities have lower performances than private hospitals because of internal politics, centralized bureaucracies, and short election cycles. Additionally, government hospitals are managed by state-elected leaders, who tend to politicize need for increased funding or shift blame concerning poor facility performance on higher authorities, instead of utilizing available resources to achieve healthy country populations.
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Furthermore, state-owned hospitals may not realize intended targets because of excessive corruption of finances allocated to improve citizens’ health by executives; a substantial financial risk is yet to find mitigation strategies. Therefore, government-owned healthcare entities are risky because of endless corruption, lack of accountability, and excessive internal bureaucracies. Finally, Lagasse (2016) highlights the financial risks of social funding, where a mix of financing and philanthropy are employed to advance positive health outcomes through investing in the healthcare industry. According to the author, social financing is risky because, if a targeted population does not show improved health through invested medical interventions, investors will lose their funds. Therefore, social financers should desist from funding healthcare organizations because of the unpredictable nature of refund or profitability mandates.
References
Lagasse, J. (2016, October 3). Better tools, analysis needed to make smart healthcare capital investment decisions, report says . Healthcare Finance News. https://www.healthcarefinancenews.com/news/better-tools-analysis-needed-make-smart-healthcare-capital-investment-decisions-report-says
